PLN asks for a raise in subsidy by Rp 25.1 trillion
Tuesday, June 14 2011 - 02:28 AM WIB
Speaking during a hearing with the Commission VII of the House of Representatives (DPR) on Monday, PLN?s President Director Dahlan Iskan said that Rp 24.4 trillion of the additional subsidy would be needed to cope the higher price of the company?s spending for BBM, coal and gas.
He said the rise in the price of oil had caused an increase in the government subsidy for power plants by Rp 4.8 trillion this year. While, the decline in the gas supply had also increased subsidy by Rp 11.4 trillion as the company should use BBM instead of gas, he said, adding that the delay in the operation of a receiving LNG terminal had caused the subsidy to increase by another Rp 2.6 trillion.
Besides due to rising fuel costs, the delay in the operation of several coal-fired power plants had also contributed to an increase in the subsidy by Rp 3.4 trillion, he said. ?The electricity losses also resulted in an increase in the subsidy by Rp 900 billion,? he added.
In the 2011 state budget, the government allocated Rp 40.1 trillion in electricity subsidy, down from Rp 58.11 trillion in 2010.
Director General for Electricity at the Energy and Mineral Resources Ministry Djarman had earlier estimated that the electricity subsidy would increase to Rp 68.8 trillion this year due to the surge in PLN?s fuel costs. (*)